Trusts – the new business process

We are pleased to see the volume of new trust cases we receive continuing to increase and appreciate you entrusting us with your clients’ investments for this important area of planning. Trust business is only expected to increase in the near term given the impending changes to IHT and pensions. As you may know, trusts are viewed as higher risk across the industry because of the complexities of their legal structures that can make them attractive vehicles for money laundering, terrorist financing and tax evasion. Consequently, there have been quite a few regulatory changes in this space in recent years.

Following a review of our approach, we are adjusting our requirements related to the Trust Registration Service (TRS) from 1 July 2025.

What are the rules?

The Trust Registration Service (TRS) is an online register managed by HMRC. It was established in June 2017 to improve transparency surrounding the beneficial ownership of assets held in trust. Since 1st September 2022, all non-exempt trusts have been required to register with the TRS:

• Within 90 days of being established; or, if earlier
• Before establishing a business relationship with a Relevant Person (which includes financial advisers and platforms).

We require the full Proof of Registration document for non-exempt trusts, to show the trust has been registered on the TRS. We currently set up the portfolio Open Awaiting Final Approval if this is outstanding. This restricts withdrawals, fees and trading on the account.

What is changing?

Having reviewed our approach and to ensure that trust applications do not need to be unwound at a future date, we will no longer be able to set up a trust portfolio that does not have a complete Proof of Registration document. The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended) and the HMRC TRS Manual confirm that we need the Proof of Registration in order to have a business relationship with the trust.

We are also required to report any missing or incorrect Proof of Registration documents to HMRC if they are not resolved within 30 days. The most common issues we see with Proof of Registration documents are:

• Not being provided at all – it is a regulatory requirement for you, the financial adviser, and Transact to receive the document before establishing a business relationship, so this cannot be missed.
• A different TRS print out being provided – the regulations confirm the Proof of Registration must be used, so we cannot accept any other format.
• Missing trustees – all trustees must be listed on the document.
• Missing beneficiaries – all individual named beneficiaries must be confirmed, as well as any potential classes of beneficiaries in the Trust Deed (i.e. ‘all children and remoter issue of the settlor’).
• Missing/incorrect dates of birth for the trustees.

How can I ensure my new Trust cases proceed smoothly?

The main documents required to set up a trust portfolio with Transact are:

• T001(TR) – Trust Portfolio Application form
• Certified copy of the Trust Deed (or certified copy of the Will and proof of death for Will Trusts)
• TRS Proof of Registration document.

The information on all three of these documents must be complete and they must all match, otherwise we may not be able to set up the portfolio.

There are some handy guides available on TOL under Information > Trust Documents, including ‘Guide to Submitting Trusts with Transact’ and ‘Guidance Notes – Trust Registration Services’, that cover the trust application process, and TRS specifically. Please speak to your regional Technical Specialist or Adviser Support Manager if you have any questions.

Technical Support are also available on 020 7608 5330 if you have any technical trust queries.

 

 

1. Introduction
2. Transact Online (TOL) –  Recent enhancements 
3. Integrations – mini-events
4. Trusts – the new business process
5. Overseas fund regime
6. Successions planning update – employee ownership trusts
7. Transact – BlackRock MPS update from Ben Roberts (MPS Manager)
8. A study in gifting – too late to change after death?
9. Investment bonds – topping up verses new policy
10. Salary sacrifice – is change on the horizon?
11. Interest on cash
12. Transact events 2025